Office of the Attorney General News Release Archive


Friday, December 17, 1999

CORNYN ANNOUNCES $2.8 MILLION SETTLEMENT IN ANTI-TRUST CASE

Substantial increase in toys distributed to needy through settlement with Mattel

AUSTIN - Texas Attorney General John Cornyn today announced that underprivileged children in Texas will receive $2.8 million worth of toys through national anti-trust settlements with four major toy companies. The toys are being distributed by the U.S. Marines Toys for Tots program.

"This holiday season thousands of underprivileged Texas children will receive toys as a result of these settlements. My office will continue to enforce the law for companies who seek to get around the rules of the marketplace," said Cornyn. "I want to applaud the Marines who are helping distribute these toys. I hope our efforts will bring additional cheer this year."

The distribution of toys resulted from national anti-trust settlements totaling $56 million with Toys 'R' Us, The Little Tykes Company, Hasbro and Mattel. The settlements resolved allegations that the companies conspired to withhold popular toys from low margin warehouse clubs and forced the manufacturers to sell the toys in multi-toy packaging. These practices ensured that consumers could not easily compare the retail prices charged by the clubs to those charged by Toys "R" Us.

The Marines are distributing toys to local programs benefitting needy children in cities across the state. Distribution of toys in Texas, as a result of the settlements, will extend through the 2001 holiday season.

The settlement agreements required all defendants to provide toys from current inventory that represented a broad variety of toys, both as to selection and age-appropriateness. Upon receiving toy shipments from Mattel, however, Texas and many other states believed that Mattel provided outdated and impractical toys that were not representative of the broad variety of toys produced by the company. An additional 35,000 toys ($280,000 worth) were to be delivered to Texas this year as a result from Mattel's failure to meet the conditions of the previous settlement agreements.

The additional supplemental distribution agreement requires that Mattel transport the toys at its expense to every state no later than December 17th. The states are authorized by the agreement to audit Mattel's distribution at the conclusion of the holiday season to ensure that Mattel met its settlement obligations with the original and supplemental toy contributions. If Mattel fails to deliver as specified, the obligation carries over to the following year and is increased by 20 percent.

"We received 1200 more toys this year than last as a result of this settlement. A lot more children, who wouldn't normally receive toys this holiday, will be very happy this year," said First Sergeant Stephen Unik of the 1st Battalion 23rd Marine Forces Reserve in Austin.

The Marine Toys for Tots Foundation is an IRS recognized 501(c)3 not for profit public charity. To contact, write or call: Marine Toys for Tots Foundation, P.O. Box 1947, Quantico, Virginia 22134 Phone: (703) 640-9433 FAX: (703) 640-0917 or log onto www.toysfortots.org.

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Contact Mark Heckmann, Heather Browne, or Tom Kelley at (512) 463-2050